Australians bought a record number of new cars last year, with big jumps in purchases of sports-utilities and commercial vehicles.

There were 1.1 million new cars purchased in 2012, a 10.3 per cent increase from 2011, the Federal Chamber of Automotive Industries (FCAI) reported on Friday.

Passenger vehicles were the highest selling segment of the market, with 576,855 units traded, up 3.1 per cent from the previous year.

The biggest market movers were 4WDs, with sales up 25.3 per cent to 305,825, and commercial vehicles, which rose 12.2 per cent to 198,302.

FCAI chief executive Tony Weber says the result was an all-time high for the new car market.

"Australia avoided much of the global financial crisis aftermath and with production resuming in Thailand and Japan, the automotive industry was able to respond to the enthusiasm of the car buying public," Mr Weber told reporters in Sydney.

"The record 2012 is a combination of these factors."

He rejected suggestions the figure was a "false number" inflated by incentives and bonuses at dealerships.

"The number that we have here is a very valid number," he said.

Toyota was the highest selling brand in 2012 with 218,176 sales, followed by Holden and Mazda.

The Mazda3 was the best selling model of last year.

Mr Weber predicted there would be a slight fall in the number of cars sold in 2013, to just over one million.

He also defended the local car manufacturing industry, despite sales of the Holden Falcon and Commodore being at "historic lows".

"The reality is that three domestic producers are in the top five brand sales," he said.